Gen Y increasingly value-focused

While Gen Y has gotten a bad wrap for being the entitled, spoiled rotten children of helicopter parents, a recent report from J.D. Power and Associates suggests that Generation Y "Early Careerists" (ages 22-29) are increasingly value-focused when it comes to brands.

While premium brands still elicit positive discussion among "Early Careerists", the report shows that the group is also very positive about value brands like Old Navy, Arby's and Subway.

[J.D. Power report]

[image via Psi XPerience]

Coupon Culture

Over the past year, there's been some chatter about consumers and their coupon habits.

The percentage of consumers who used coupons had actually been falling, that is, until the most recent recession. According to a recent article by the NYTimes,

"Coupon redemption in America peaked in 1992, at the end of a recession, when 7.9 billion coupons were redeemed...by 2006, that number fell to 2.6 billion and stagnated there through 2008."

But during the first half of 2009, "coupon redemption climbed 23 percent. Some 1.6 billion coupons were redeemed."

Something very interesting that the piece also points out is that demographically disparate consumers have embraced the coupon culture. In fact, in January and February of 2009:

- coupon use among young, single consumers with minimal savings rose 14 percent

- coupon use by affluent consumers who were born in the late 1950's and 1960's rose 13 percent

- households earning $70,000 or more a year were among the top coupon users
(Source: Knowledge Networks/PDI and Nielsen)

It will be interesting to watch this trend and see if coupon redemption continues to climb -- redemption numbers are still nowhere near the levels that we saw in the 1990's.

Or maybe coupon redemption will just level off as the economy makes its slow recovery.

Men, Women, and the Purchase Process

A recent piece on Fast Company's brilliant blog, Femme Den, offered some astute insight into how men and women differ when it comes to choosing and purchasing products.

The article suggests that purchase decisions are influenced by our hunter and gatherer instincts. When buying a product, men want to path-find -- it's part of the hunting instinct. When shopping for a product, they go linear and deep. Men tend to extensively research a product and then they make the purchase.

But women tend to differ in their process. Women go wide with their search, considering how the product will affect the individuals in their lives. A women gathers a product for both herself and her tribe.

"While he tends to be more fascinated by the product itself, she is enticed by the sum of many things, including considerations beyond herself and her personal needs.
"

The post also takes a look at what men and women desire from consumer electronics. Men typically like to figure out and conquer gadgetry, while women tend to want electronics to be more intuitive. She wants the technology to simplify her life.

"Women are usually the main caretakers of home and family, often while working a full-time job. She is pressed for time, and therefore, tends to have less tolerance for time-consuming and poor product experiences. She wants a product to work well right from the start...it’s a matter of priority and patience. Women prioritize intuitiveness in products."

Bottom line? It's crucial to understand the difference in how men and women make their purchase decisions. Women can have very different priorities when it comes to products, so it's vital that their viewpoint is taken into consideration.

[Femme Den]

Gift card watch: consumers buying more gift cards

Retailers may be able to breathe a small sigh of relief when it comes to their gift card business.

According to a recent report by The Hartman Group, the number of consumers purchasing gift cards has significantly increased over the past six months. This interesting finding suggests that consumers may actually view gift cards as practical gifts in this tough economy. If this trend continues for the remainder of the year, it could spell good things for sales of gift cards at the holiday gift-giving season.

However, the report also notes that while more consumers are purchasing gift cards, consumers are actually spending less on gift cards. The study suggests that the lower rate of spending on gift cards can be attributed to consumers’ poor views of the economy. In addition to that, almost half of consumers are reluctant to purchase gift cards due to the myriad of retailer and restaurant bankruptcies.

We’ll be following what’s happening on the gift card front over the course of this year. Be sure to stop back for updates!

[via The Hartman Group: Gift Card Buying Trends, 2009]

Survey says! Americans more positive about industries in '09

According to a recent Gallup poll, Americans are more positive about most major businesses and industries this year, after being more negative nearly across the board in 2008.

Some notable findings from the poll include:

- The computer industry remains the most positively rated at 62 percent, but the restaurant industry follows not far behind at 57 percent.

- The figures for the restaurant industry are up 6 percentage points over the 2008 numbers.

- The biggest gainers since last year are the grocery industry, the airline industry, and the federal government

- The banking and automobile industry scores continue to drop over this year.

[via Gallup]

This Week in Circular-ville: Back-to-School

The Back-to-School season is an important time of year for many retailers, and there continues to be a lot of buzz about BTS 2009 due to our country's economic situation. As the countdown to the first school bell begins, SBC Advertising's Consumer Lab takes a look at the circulars from this past Sunday. Here's who was promoting what in their weekly ads (as distributed in the Columbus Dispatch):

Grocery

Meijer

"We get high marks for low prices" tagline with a "Back to School 2009 Mom Approved" stamp. Featuring all licensed backpacks at 40% off.
Includes:

• All Falls Creek Kids' Shoes at 14.99
• 25% off all licensed Lunch Bags and Totes
• Buy $10 in any combination of Kellogg's, Keebler, Sunshine or Eggo Products and get $10 off instantly on any one backpack.

Layout: Licensed backpacks, lunch bags and shoes in a school locker setting.

Drug Store

Walgreens

"Major in Savings" tagline. Featuring a .49 cent sale on school supplies. Also features .49 cent coupon's for Mars candy, and Big Roll Bathroom tissue. Also:

• Offering BOGO on bindgers, and Buy 1 Get on 50% on Mead Five Star notebooks.

Some grocery and cosmetic items also featured.
Layout: Traditional drug store look that is cluttered and unfocused.

Office Supply

OfficeMax

"Back to School for pennies." 20% off everything you can fit into a standard size brown grocery bag (printed ON the actual brown grocery bag).
Layout: Drawn schools supplies, and a back to school check off list.

Staples

"Staples = Savings. Huge Deals!" Features .25 cent black + white composition books, and $1 school supplies.
Also features

• Dell laptop for 499.98
• savings of 25 - 50% on all backpacks, and
• TI calculator for 89.99.

Staples is having a Teacher Appreciation Day '09 this Saturday, August 22 at 9am until noon.
Layout: Looks like layout is on a notepad. Design is cluttered and difficult to read.

Department Store

Sears.

"Life. Well spent." tagline and a "Get your jean on sale" promo featuring name brands like Levi's, BONGO, South Pole, and Canyon River Blues. Promoting layaway AND Christmas Club Card, where customer adds money and earns a 3% reward.
Layout: Young couple in an air guitar, and singer pose. Selena Gomez sweepstakes event is also promoted. Not as clutter as Kohl's ad.

Kohl's

"Back-to-school sale saving is in session." Features Avril Lavinge promoting the exclusive Abbey Dawn brand, including a new fragrance. Promotion is an extra 15, 20 or 30% off everything with Kohl's charge.
Layout: Avril Lavinge is on the cover, solo. Busy, rock-n-roll vibe.

JCPenney.

"Schooled in: Style. Smart looks for less." features young couple with Decree brand clothing. Promotion is Buy 1, get 1 for $1.00 Junior's Decree Tops and Bottoms. Also introducing Decree for guys with $14.99 tee or vest, and $24.99 straight-leg jean.
Layout: Young couple in simple, model-like pose. Cleanest ad of all the department stores. More singularly focused, too.

Craft

JoAnn

"Value is a bright idea." featuring back to dorm items such for storage and décor.

• Typical 40% coupon is available, plus a 609% off of custom framing.
• Additional decor items and dollar deals are featured as well.

Layout: Very feminine in bright pinks and orange, and feature a young woman organizing her space.

Discount

Wal-Mart

"Save money. Live better." No back-to-school specific headline on their circular. Features $348 Toshiba laptop and $1.50 school supplies.
Layout: very clean, and focused.

Target

"Expect more. Pay Less." Similar to Wal-Mart, no back-to-school specific headline is on their circular.
Features back-to-dorm items:

• $199 Magnavox 19" LCD HDTV
• $79 Haier 2.8 cu ft. stainless steel refrigerator
• $18 butterfly chair
• $3.50 bath towels
• $16 3-shelf bookcase
• $5 home pillow

Layout: Features a young woman in a contemporary setting interacting with many of the sale items.

Bottom line?

There's a lot of noise out there this time of year. It will be interesting to see who comes out on top. Our guess is that Wal-Mart's efforts (and extreme pricing) won't go unnoticed, while some of the department stores, like JCPenney may continue tostruggle to find their niche, despite their cleaned up brand image.

Walmart's bold move: scoring a product's environmental impact

Walmart recently unveiled a plan to determine the social and environmental impact of every product they sell. Through the implementation of a product indexing system, consumers will be able to evaluate a product's impact on the environment. The retail giant has already assembled a team of experts (including members of the Environmental Defense Fund) who will be charged with formulating the index.

Walmart's recent efforts on the environmental front are no doubt impressive. When they introduced compact florescent light bulbs in their stores, they made a big statement about their environmental priorities. The move to create a system that scores a product's sustainability has the potential to not only affect how manufacturers make their products, but also how other retailers classify them.

This initiative could mean big changes for the future of retail as we know it.

[image via the chic ecologist]

There Goes the Neighborhood

Starbucks is taking on a little re-branding. But here's the twist: they're removing the Starbucks name from stores.

This trial re-branding effort is taking place in at least three Starbucks stores in Seattle. A few months ago, Starbucks began remodeling stores to reflect a more rustic, eco-friendly asthetic. Instead of keeping the Starbucks name on the door, the coffee purveyor is naming stores after the neighborhoods in which they are located. If the effort goes well, they may roll this model out in other markets.

This is a bold move for the brand, no doubt influenced by the criticism it's received for expanding quickly and beoming a little too corporate and cookiecutter. It's apparent Starbucks hoping to minic the look and feel of neighborhood coffeehouses.

All in all, this move leaves me with a funny feeling in my stomach. I appreciate that Starbucks recognizes the value in being authentic. But do they realize that authenticity is not something that is easily bought? And how will consumers really react to this? Will they feel the brand is trying to pull the wool over their eyes? That could spell trouble.
[via the Seattle Times]
[image via jackieam]

coupons: more than just saving money.

Research and trends powerhouse Yankelovich sent out a MONITOR minute (their free trends email subscription) about coupon users [sign up for these here]. From January to June 2009, looks like there were more coupons downloaded than in all of 2008. Not surprising.

What is surprising is this: Coupon usage is not just about saving money. There's more to it than that. It seems that coupons users (especially men) like the feeling of “being in the know” and the exclusivity of the deals that they can find. The activity of downloading coupons encourages folks to be engaged consumers. And that’s good news for the brands that they’re using.

Yankelovich recommends that companies view coupon-downloading as a gateway activity to expanding the relationship with your target audience. A more engaged consumer means better brand loyalty in the long run. This coupon-yielding person could serve as a helpful ally to your brand.

Makes cents to me (wa-wah)!

[photo: freedigitalphotos.net]

Uh-Oh: Frugality Is the New Reality For BTS Shoppers

Early predictions about the 2009 Back to school shopping season are starting to make their way into the media. And it's not looking good for retailers.

Most parents of kids K-12 say they will cut back in spending this year due to the economy and the increased frugality that is becoming more of the shopping norm. NRF’s 2009 Back to School Consumer Intentions and Actions Survey (conducted by Columbus’ own BIGresearch) is showing a decline of 7.7% from BTS 2008 spending. The only spending this is expected to increase? Electronics, which is expected to increase by 11% as the prices of computers continue to become more affordable.

An unexpected benefactor to this upcoming BTS season may be drug stores (like Walgreens, CVS, et al.) where more people than last year are expected to shop these stores for BTS. Why? Drugs stores have expanded their merchandise mix, and customers have noticed. However, the most popular destination for BTS shopping is still the discount store. Almost 75% of shoppers will be shopping discount.

On the other side of the education spectrum – College spending is expected to increase slightly over last year (up 3%) however, fewer people are planning to attend college for advanced degrees so total spending is down. In addition, more kids are planning on living out their college years at home instead of on-campus, which may impact retailers that focus on the Back to dorm segment.

What does this mean for retailers? Time to embrace the new norm if you haven’t already. Give consumers what they are looking for: coupons, sales, BOGOs, and early season specials.

[photo: freedigitalphotos.net]

New in Ad Tech: Eye Tracking Ad

This ad for Amnesty International is the first-ever poster to employ eye-tracking technology. The poster is an anti-abuse ad that depicts a smiling couple - at least when you're looking at it. When you look away, it shows a man hitting a woman.

According to blog Gizmodo, this is how the technology works -

“The billboard works by scanning its proximity with an eye-tracking camera, which triggers an image switch on the display panel when it senses someone looking at it. The change only occurs after a brief delay, so that observers understand what's going on, and get the message.”
Pretty innovative stuff -- and the medium is a perfect fit.

Now I just want smellavision to become reality.
[via Gizmodo]

Facebook Reaches 250 Million Users

And so the social networking site continues on its quest for world domination.

[via Facebook]

Order Up! Chipotle Partners with Food, Inc. to Drop Knowledge on Consumers

Chipotle, the ever vocal champion of organic and sustainable food practices, has partnered with Food Inc., a new film that examines unsavory practices within America's food industry.
The partnership is a fitting move for Chipotle, as they hope to shine a spotlight on their "Food with Integrity" philosophy.
[via brandweek]

Survey Suggests Creating Retail “Wow” Moments Can Be Tough

A new consumer survey about customer service found there are five major areas that contribute to a great shopping experience. However, survey respondents cited a total of 28 elements that can contribute to a great shopping experience.

According to the report, an experience that really "wows" shoppers typically contains 10 of those 28 elements – simultaneously. And to further reduce a retailer’s chances for a “wow” moment is that the elements (of course) vary among individuals. The challenge for retailers to excel in customer service is down right daunting!

But worry not, dear retailers, for all is not lost. The report offers a strategies for beating the variability in preference among consumers.

[via Forbes]